Blue Flame v. Chain Bridge — Deposition of Richard Chivaro (Exhibit 119)
- Date
- 2021-05-27
Summary
Exhibit 119, filed May 27, 2021 as Document 157-7 in Blue Flame Medical LLC v. Chain Bridge Bank, N.A., Civil Action No. 1:20-cv-00658, in the U.S. District Court for the Eastern District of Virginia. It contains pages from the remote deposition via Zoom of Richard J. Chivaro taken March 4, 2021, including the caption and appearances of counsel for the plaintiff, the defendants and third-party plaintiff, and third-party defendant JPMorgan Chase Bank, N.A. In the testimony, counsel for Chain Bridge Bank asks whether California could prepay vendors for PPE in March 2020 and about text messages marked as Defendant's Exhibit 94. The witness testifies that prepayment is normally prohibited and that the governor decided under emergency authority to allow it. Counsel for the witness repeatedly objects on scope, foundation and privilege grounds.
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Case 1:20-cv-00658-LMB-IDD Document 157-7 Filed 05/27/21 Page 1 of 6 PageID#
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EXHIBIT 119
Richard J. Chivaro 30(b)(6) 3/4/2021
Case 1:20-cv-00658-LMB-IDD Document 157-7 Filed 05/27/21 Page 2 of 6 PageID#
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1 IN THE UNITED STATES DISTRICT COURT
2 FOR THE EASTERN DISTRICT OF VIRGINIA
3 (Alexandria Division)
4 X
5 BLUE FLAME MEDICAL LLC,
6 Plaintiff,
7 V. Civil Action No.
8 CHAIN BRIDGE BANK, N.A., 1:20-cv-00658
9 JOHN J. BROUGH and DAVID M.
10 EVINGER,
11 Defendants.
12
13 CHAIN BRIDGE BANK, N.A.,
14 Third-Party Plaintiff,
15 V.
16 JPMORGAN CHASE BANK, N.A.,
17 Third-Party Defendant.
18 X
19 Remote Deposition
20 Thursday, March 4, 2021
21 Deposition via Zoom of RICHARD J. CHIVARO,
22 a 3 0 (b) ( 6) witness herein, called for examination by
�7 Trustpoint. One Alderson. 800.FOR.DEPO
(800.367.3376)
Richard J. Chivaro 30(b)(6) 3/4/2021
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1 counsel for Defendants/Third-Party Plaintiff in the 1 APPEARANCES (Continued):
2 above-entitled matter, pursuant to notice, the 2
3 witness being duly sworn by MARY GRACE CASTLEBERRY, a 3 On behalfofthe Defendants/Third-Party
4 Notary Public in and for the State of Maryland, taken 4 Plaintiff Chain Bridge Bank, N.A.:
5 at 9:39 am. PST, Thursday, March 4, 2021, and the 5 GARY A. ORSECK, ESQ.
6 proceedings being taken down by Stenotype by MARY 6 MATTHEW M. MADDEN, ESQ.
7 GRACE CASTLEBERRY, RPR, and transcribed under her 7 DONALD BURKE, ESQ. (Via Streaming Only)
8 direction. 8 LESLIE ESBROOK, ESQ.
9 9 Robbins Russell Englert, Orseck,
10 10 Untereiner & Sauber
11 11 2000 K Street, N.W., 4th Floor
12 12 Washington, D.C. 20006
13 13 (202) 775-4500
14 14 gorseck@robbinsrussell.com
15 15 mmadden@robbinsrussell.com
16 16 dburke@robbinsrussell.com
17 17 lesbrook@robbinsrussell.com
18 18
19 19
20 20
21 21
22 22
Page 3 Page 5
1 APPEARANCES (Continued):
1
APPEARANCES:
2 2
3
On behalf of the Plaintiff Blue Flame Medical 3 On behalf of the Third- Party Defendant JPMorgan
4
LLC: 4 Chase Bank:
5
JASON MITCHELL, ESQ. 5 ALAN SCHOENFELD, ESQ.
6
GREG KETCHAM-COL WILL, ESQ. 6 Wilmer Cutler Pickering Hale & Dorr LLP
7
KENI UKABIALA, ESQ. 7 1875 Pennsylvania Avenue, N.W.
8
Schulte Roth & Zabel 8 Washington, D.C. 20006
9
901 15th Street, N.W., Suite 800 9 (212) 663- 6981
10
Washington, D.C. 20005 10 alan.schoenfeld@silmerhale.com
11
(202) 729-7476 11 and
12
gregory.ketcham-colwill@srz.com 12 GABRIEL TORRES, ESQ.
13
j ason.mitchell@srz.com 13 JPMorgan Chase
14
ekenedilichukwu@ukabiala@srz.com 14 Assistant General Counsel
15
and 15 383 Madison Avenue
16
ETHAN BEARMAN, ESQ. 16 New York, New York 10179
17
The Bearman Firm 17 (212) 270- 6000
18
I 0250 Constellation Boulevard, Suite I 00 18
19
Los Angeles, California 90067 19
20
(747) 344-1004 20
21 21
22 22
�7 Trustpoint. One Alderson. 800.FOR.DEPO
(800.367.3376)
Richard J. Chivaro 30(b)(6) 3/4/2021
Case 1:20-cv-00658-LMB-IDD Document 157-7 Filed 05/27/21 Page 4 of Page 23 (86 - 89)
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1
time period; is that correct? 1 state to make purchases on a prepayment basis. And I
2 do know that that was one of the discussion items
2
A. Three calls, yes.
3 that the controller had with Mr. Thomas on March
3
Q. And does seeing this text chain refresh
4 23rd. And that was a telephone call, that she
4
your memory as to the substance of any of those
5
calls? 5 indicated that the governor's office had agreed to
6 prepayment of the amounts to vendors for this
6
A. No.
7 purpose.
7
Q. Did Blue Flame require prepayment for any
8 portion of the N95 mask sale? 8 BY MS. ESBROOK:
9 MS. PORTER: Objection. Lack of 9 Q. Okay. And in this March 23rd telephone
10 call that you mentioned --
10
foundation. Exceeds the scope.
11
THE WITNESS: That was the initial 11 A Yes.
12
understanding, yes, that they were requiring 12 Q. -- what else did Ms. Yee and Mr. Thomas
13 discuss, ifanything?
13
prepayment.
14
BY MS. ESBROOK: 14 A That's the only thing she communicated to
15 me that they discussed.
15
Q. Did that understanding change at any point
16
in time? 16 Q. And how did Ms. Yee learn -- excuse me.
17
A. Yes. I believe that he, Mr. Thomas, later 17
A I was just going to say she learned of
18
came back and changed the fact that they did not need 18
this prepayment authorization by the governors at
19 sometime prior to that, that -- I think around the
19
the prepayment, that they could do it with a period
20 21st or the 22nd, they were -- the governor's office
20
of time, kind of an open book account kind of
21 was meeting with his Office of Emergency Services and
21
situation where the state would receive the product
22 Department of General Services and the controller on
22
and then have a certain number of days to inspect it
Page 87 Page 89
1
and then make the payment. 1
the issue of whether prepayment was possible for
2
Q. For the contract that the state actually 2
purchasing of PPE.
3
entered into with Blue Flame, do you know whether 3
And up to that point, the Department of
4 prepayment was required? 4
General Services had taken the position that based on
5 MS. PORTER: Objection. Lack of 5
the contracts law in California, public contracts
6
foundation. Exceeds the scope. 6
code, prepayments were prohibited. The governor,
7 THE WITNESS: I do not. 7 under his emergency authority, decided to waive any
8 BY MS. ESBROOK: 8
government code sections or public contract code
9 Q. Does the state normally prepay vendors on 9
provisions that prohibited prepayment and allowed
10
procurement contracts? 10
them to proceed. I don't know if that helps or not,
11
MS. PORTER: Objection. Lack of 11
but that's kind of what happened.
12
foundation. Exceeds the scope. 12
BY MS. ESBROOK:
13
THE WITNESS: No. Normally it's 13
Q. Thank you. That is helpful.
14
prohibited. 14
Did the controller's office understand the
15
BY MS. ESBROOK: 15
prepayment authorization to be made in order to
16
Q. Was it allowed at the end of March 2020 to 16
contract with Blue Flame Medical specifically?
17
prepay vendors? 17
MS. PORTER: Objection.
18
MS. PORTER: Objection. Exceeds the 18
THE WITNESS: It was -- go ahead.
19
scope. 19
MS. PORTER: Lack of foundation. Scope.
20
THE WITNESS: I believe it was. It was a 20
THE WITNESS: It was not done for -- for
21
determination made by the governor that he had the 21
Blue Flame specifically.
22
emergency authority, emergency powers to order the 22
BY MS. ESBROOK:
�7 Trustpoint. One Alderson. 800.FOR.DEPO
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Richard J. Chivaro 30(b)(6) 3/4/2021
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1 Q. Okay. And I'm going to turn to 1 concluded it was not --
2 Defendant's Exhibit 94, the text thread from 2 MS. PORTER: I want to remind Mr. Chivaro,
3 Ms. Yee's phone. And I'm going to tum to -- one 3 it seems like we're getting close to information that
4 moment, please -- the page Bates numbered SCO1538. 4 might be protected by the attorney-client privilege.
5 And Mr. Chivaro, I would direct your 5 And I'm instructing you not to answer with regard to
6 attention to this text from, I believe, Ms. Yee to 6 anything that would be privileged information.
7 Mr. Thomas on March 22nd at 11:06 p.m., and Ms. Yee 7 THE WITNESS: Okay. That's it. I have
8 says, "I will get my folks working on how to 8 nothing further to add then.
9 facilitate prepayment. Thank you, John. Get some 9 BY MS. ESBROOK:
10 rest." 10 Q. Okay. That's fine. I just want to direct
11 Do you see that? 11 your attention to one other text on this that same
12 A. I do. 12 night, March 22nd. So the earlier message we looked
13 Q. And if we just scroll down a little bit, 13 at was 11: 06 p.m. I'm just going back a half hour on
14 Mr. Thomas on March 23rd writes back and says, "I was 14 the page Bates stamped SCO1537, a text message from
15 just calling to brainstorm about how to get passed 15 Ms. Yee to Mr. Thomas, March 22nd at 10:26.
16
this 30-day payment issue." 16 And Ms. Yee says, "Without invoking my
17 MS. PORTER: Objection. Mischaracterizes 17 name, ask him if there is anything that can be done
18
the thread. Omits information between those two 18
to authorize prepayment. 'Can't OES or the
19 texts. 19 controller figure out a way for prepayment to happen
20 BY MS. ESBROOK: 20 in an emergency?' BTW, what is Michael's full name
21 Q. All right. Let me just rephrase. I'll 21 and position? Thanks."
22 just stick with that one message, Mr. Chivaro, in 22 Do you see that?
Page 91 Page 93
1 which Ms. Yee says, on March 22nd on page SCO1538, "I 1
A. I do.
2 will get my folks working on how to facilitate 2
Q. Okay. And I realize I did not read you
3 prepayment." 3
the text prior to that, but I will show you now,
4 Do you see that? 4
Mr. Thomas, two messages prior said, "I'm texting
5 A. I do. 5
with Michael now." And do you understand that
6 Q. And I think you told me that at some point 6
Michael to be the same person referred to in the text
7 around this time, the governor's office does end up 7
I just read to you referred to as him --
8 allowing authorization for prepayment on vendor 8
A. That would be Michael -- Michael Wong,
9 contracts, correct? 9
yes.
10 A. Correct. 10
Q. And Michael Wong is an employee in the
11 Q. Do you know why the controller's office 11
Department of General Services; is that right?
12 wanted to get involved in facilitating prepayment? 12
A He's in charge of procurement for General
13 MR. MITCHELL: Object to the form. 13
Services, correct.
14 THE WITNESS: Again, Mr. Thomas did seem 14
Q. Okay. And do you know why Ms. Yee is
15 to insist on prepayment as a requirement to get the 15
asking Mr. Thomas not to invoke her name?
16 masks. 16
A Yes, I do. At the time, as I just
17 BY MS. ESBROOK: 17
indicated, the governor was meeting with General
18 Q. Okay. And -- 18
Services, Office of Emergency Services and the
19 A. And the controller had communicated that 19
controller's office to determine whether or not
20 to me, that they wanted prepayment and we looked at 20
prepayments were possible.
21 the issue. The legal office looked at the issue to 21
At the time this was issued at 3/22 10:26
22 determine whether prepayment was possible. We had 22 o.m. the controller was getting a little ahead of
�7 Trustpoint. One Alderson. 800.FOR.DEPO
(800.367.3376)
Richard J. C hivaro 30(b)(6) 3/4/2021
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1
the curve and she did not want to seem to be taking a 1
stated, that OES had determined that prepayment was
2
position one way or the other with respect to this 2
not possible. And that was communicated to
3
issue. Rather, she's told them that without invoking 3 Mr. Thomas. But that was all before the governor
4 her name, he should raise the question. The governor 4
made his decision.
5
had not come to a decision at that point yet as to 5 Q. I see. So the discussion that you're
6
whether prepayment would be allowed. She just did 6
referring to is not -- was not a discussion with the
7
not want to be speaking out of tum at this time, so 7
governor's office?
8
she asked that her name not be invoked. 8 MR MITCHELL: Object to the form.
9
Q. And when you say, "The controller was 9
THE WITNESS: No, it was with the
10
getting a little ahead of the curve," what do you 10
governor's office at first. She did not communicate
11
mean by that? 11
to the governor's office that Blue Flame wanted
12
A. Yes. Well, the governor had not made his 12
prepayment, but I think that the governor's office
13 decision yet. But she knew the decision was imminent 13 got that information directly from either OES or
14
one way or the other. 14
Daniel Kim at DGS.
15
Q. Okay. And in her text, when she writes in 15
BY MS. ESBROOK:
16
quotes, "Can't OES or the controller figure out a way 16
Q. And did Ms. Yee speak to anyone at the
17
for prepayment to happen in an emergency," she is 17
Department of General Services about her feelings on
18
telling Mr. Thomas what to say to the governor's 18
prepayment?
19
office there; is that correct? 19
MS. PORTER: Objection to the extent it
20
A. Yeah. She knew that was the question 20
calls for a deliberative process. Objection to form.
21
under consideration by the governor. 21
THE WITNESS: She did have a conversation
22
Q. And was the controller's office involved 22
about this with Mr. Kim.
Page 95 Page 97
1
in the decision to authorize prepayment? 1
BY MS. ESBROOK:
2
MS. PORTER: Objection. Vague. Q. And again, without getting into any
2
3
THE WITNESS: The controller participated deliberative process privilege issues, can you relay
3
4 what Ms. Yee told Mr. Kim in that conversation?
4
in the discussion as -- but again, it was a decision
5
of the governor, not the controller. 5
MS. PORTER: Objection. Exceeds the
6
BY MS. ESBROOK: 6
scope.
7
Q. And the discussion you're referring to is 7
THE WITNESS: The only thing she
8 communicated to Mr. Kim was that this prepayment
8
the discussion --
9
A Whether or not OES or the controller could 9 seemed to be a prerequisite for the masks to be
10
authorize prepayment in an emergency. 10
delivered.
11
Q. I see. And in those discussions that 11
BY MS. ESBROOK:
12
Ms. Yee participated in about whether or not to 12
Q. And by a prerequisite for the masks to be
13 authorize prepayment, did she discuss Blue Flame's 13 delivered, are you referring to Blue Flame's masks?
14
offer to sell masks to the state of California? 14 A. Yes.
15
MS. PORTER: Objection to the extent it 15
Q. Did the controller's office authorize
16
calls for a deliberative process and -- 16
warrants for any other PPE purchases that required
17
THE WITNESS: She had-- she had given 17
prepayment in March or April 2020?
18
that information to Daniel Kim at General Services. 18
MS. PORTER: Objection. Exceeds the
19
BY MS. ESBROOK: 19
scope.
20
Q. Okay. And maybe I -- I'm sorry. Go 20
THE WITNESS: At the time, we only paid
21
ahead. 21
the two vendors. So it was Epic and Blue Flame. So
22
A And I think that the reolv was, as vou 22
there were not any others under consideration at that
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